Work

When aid misses the target: competing objectives, new classifications, and smarter delivery

Year: 2025

Type: article

Abstract: • Allocation of aid reflects various donor motives. • Evidence that aid promotes growth is limited. • Aid is effective in some areas favored by donors. • Donor motives mediate the effectiveness of aid. Western donors allocate over US$ 200 billion annually to official development assistance (ODA), yet much of this funding serves goals other than sustained recipient‑country development. In this paper, I argue that competing objectives and uses—including in‑donor refugee costs, geopolitical interests, and commercial ties—and inflated aid budgets undermine ODA’s credibility. I then argue for a narrow, development‑focused definition of ODA that excludes humanitarian relief and global public goods and suggest that concentrating development aid on infrastructure, education, and health—linked to a small number of ex ante conditions and delivering it primarily through budget support in democracies—would improve alignment with recipient priorities, bolster government accountability, and maximize developmental impact.

Source: World Development

DOI: 10.1016/j.worlddev.2025.107159

Author: Axel Dreher

Institution: Heidelberg University

Language: English

Topic: International Development and Aid

Subfield: Development

Field: Social Sciences

Domain: Social Sciences

SDGs: Partnerships for the goals, Peace, justice, and strong institutions

Open Access status: hybrid

Estimated APC paid: $5,895